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TIM Preps for 3G

Light Reading
LR Mobile News Analysis
Light Reading
3/26/2004

Telecom Italia Mobile SpA (Milan: TIM) today unveiled plans for future network upgrades, announcing the launch of EDGE (Enhanced Data for GSM Environment) services next month and the introduction of 3G UMTS (Universal Mobile Telecommunications System) services in June.

Speaking from the carrier’s annual financial briefing today in Milan, spokeswoman Roberta Vivenzio confirmed to Unstrung that EDGE services will be available nationwide “from April,” beating its initial target of “the middle of 2004” (see Europe Gets an EDGE ).

“We can’t announce a specific date yet though,” she says.

An enhancement to the Global System for Mobile communications (GSM) standard that increases data throughput to a potential 384 kbit/s, EDGE uses the same basic network structure as 2G technologies. Some wags refer to EDGE as a 2.75G technology, because it is faster than existing 2.5G (GPRS) networks but slower than true 3G (UMTS) networks are expected to be.

TIM -- Italy’s largest carrier by subscriber base (26.1 million) -- will become only the second European carrier to commercially launch EDGE services, following the lead of TeliaSonera AB [TAB?].

Meanwhile the carrier is gearing up for its full-scale commercial launch of UMTS services at the end of this year with a corporate user trial in June.

UMTS is the 3G upgrade to the GSM standard, using a wideband-CDMA (W-CDMA) air interface on top of the GSM core network to increase voice capacity and boost data-transfer speeds to a possible 2 Mbit/s.

Details for the summer project remain sketchy, with Vivenzio unable to confirm whether the enterprise trial will enable full voice services or will only offer high-speed laptop data services.

A recent deal with Lucent Technologies Inc. (NYSE: LU) for the supply of 3G PC modem cards suggests the latter option is most likely -- a strategy already adopted by Vodafone Group plc (NYSE: VOD), mmO2 plc, and KPN Mobile (see TIM Picks Lucent, Novatel, V'fone Launches 3G Service, O2 Germany Launches 3G, and KPN to Launch 3G in June).

Either way, the carrier claims it is on target for a 3G “Christmas campaign,” stating that its UMTS network already covers 90 percent of the population, exceeding regulatory coverage requirement of all regional capitals by mid-2004.

Swedish vendor LM Ericsson (Nasdaq: ERICY) is the infrastructure supplier for both networks (see Ericsson Extends TIM Deal).

— Justin Springham, Senior Editor, Europe, Unstrung

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